Why Consumer Product Metrics Are All Terrible: The Hierarchy of Engagement

Why Consumer Product Metrics Are All Terrible: The Hierarchy of Engagement

User engagement is the lifeblood of any consumer product. It determines the success or failure of a product and directly impacts its growth and sustainability. However, when we delve into the metrics surrounding user engagement, we realize that they are often far from ideal. In fact, they can be downright terrible.

Let's start by examining the conversion rates of typical consumer products. It is disheartening to discover that a staggering 90% of users refuse to sign up for a product. This initial rejection is followed by another blow - over 90% of users who do sign up eventually become disengaged and inactive over time. The numbers paint a bleak picture.

Mobile apps, although they may boast better engagement metrics, suffer from lower upfront conversion rates. This discrepancy can be attributed to the fact that mobile app traffic usually stems from word-of-mouth recommendations. People actively seek out these apps to try them, resulting in higher sign-up rates. However, even with this advantage, the majority of users, often over 90%, fail to engage with the app on a daily basis. They either churn or only use the app sporadically throughout the month. Achieving a daily engagement rate of more than 10% is considered a success, though most apps struggle to reach even 5%.

To improve engagement and frequency, it is crucial to align your product with users' existing behaviors instead of asking them to adopt new habits. This simple shift can have a significant impact on user retention and satisfaction. Asking users to completely change their routines and adapt to a new product is a recipe for failure. Instead, find ways to seamlessly integrate your product into their daily lives, making it an effortless part of their routine.

Another significant hurdle in creating a compelling user experience lies in the fact that a substantial portion of users have no connections within the service. This means that their feeds need to be filled with content from a single source, or worse, impersonal content. Instagram, one of the most explosively viral products in recent history, had a staggering 65% of its users disconnected from anyone else. This highlights the challenge of creating a vibrant and engaging news feed when only a small percentage of users actively contribute content.

The 1% rule, which states that only a fraction of users will author content, further compounds the difficulty of maintaining a healthy and dynamic news feed. With such a small percentage of users willing to create content, it becomes increasingly challenging to curate an engaging experience for the majority.

When we consider these factors, it's no wonder that many products struggle to attract and retain users. The task of creating a product that not only captures users' attention but also keeps them engaged is undeniably challenging.

To gauge the success of user engagement, many rely on the metric of Daily Active Users to Monthly Active Users (DAU/MAU). While a 30% ratio is considered good, it pales in comparison to WhatsApp's astounding 70%. This stark difference underscores the distinction between a good product and a truly exceptional one.

In light of these challenges, it is essential to understand the hierarchy of engagement. It consists of three levels: growing engaged users, retaining users, and self-perpetuating. By focusing on these levels and implementing effective strategies, product developers can maximize user engagement and propel their product towards success.

To achieve these goals, here are three actionable pieces of advice:

1. Understand the user's existing behaviors: Instead of asking users to adapt to your product, find ways to seamlessly integrate it into their daily routines. By aligning your product with their existing behaviors, you can increase user engagement and retention.

2. Foster connections within the service: Encourage users to connect with others within your product. By creating a sense of community and facilitating interactions, you can enhance engagement and create a more vibrant user experience.

3. Curate personalized and relevant content: With a small percentage of users actively creating content, it is crucial to curate personalized and relevant content for the majority. By tailoring the user experience to their preferences and interests, you can increase engagement and satisfaction.

In conclusion, the metrics surrounding user engagement in consumer products are often far from ideal. However, by understanding the challenges and implementing effective strategies, it is possible to improve user engagement and create a successful product. The hierarchy of engagement, focusing on growing engaged users, retaining users, and fostering self-perpetuation, provides a roadmap for achieving these goals. By aligning your product with users' existing behaviors, fostering connections, and curating personalized content, you can enhance engagement and propel your product towards greatness.